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Released March 07, 2022 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--The U.S. and many other Western nations are trying to move on from the COVID-19 pandemic by lifting restrictions, and de-emphasizing masks and other protective measures. But Canada's SNC-Lavalin Group Incorporated (TSX:SNC) (Montreal, Quebec) took a hit in fourth-quarter 2021 from absent workers, supply-chain challenges, reschedulings and other issues stemming from the pandemic.
The engineering-focused company is moving forward with several high-profile projects in 2022, including those for mining, nuclear energy and infrastructure, that it hopes will reverse the trend. Industrial Info is tracking more than US$47 billion worth of active projects involving SNC-Lavalin worldwide, including more than US$36 billion worth in the U.S. and Canada.
"With the [COVID-19] omicron variant, we were seeing absenteeism of up to 50% on some of the jobs," said SNC-Lavalin President Ian Edwards in a quarterly earnings-related conference call with analysts. "And we had a very significant spike in productivity loss. I was on both job segments in Trillium recently to see and feel just how impactful productivity loss has been. And when you think about these jobs at the end of their stages, with social distance requirements that restricts a number of people you can put on the job with absenteeism, it obviously means we're struggling to get labor on the job."
Edwards was referring to the US$1.77 billion Stage 2 extension of Ottawa's light-rail Trillium Line South, which is part of a broader, US$4.6 billion light-rail extension program. The 9.9-mile project, which would link various points in the city to the Ottawa International Airport, began construction in third-quarter 2019 and originally was set to wrap up toward the end of last year; it will not wrap up until the third quarter of this year, at the very earliest. Subscribers to Industrial Info's Global Market Intelligence (GMI) Project Database can read a detailed project report.
One project is back on track after facing a series of delays related to COVID-19: BC Hydro's (Vancouver, British Columbia) Site C Dam Project in Fort St. John, British Columbia, which is the highest-valued project involving SNC-Lavalin's services. Construction of the 1.1-gigawatt (GW) hydroelectric power station on the Peace River began in early 2016 and reached 50% completion in December, with a revised in-service date for early 2025.
Click on the image at right for a map of the Site C Dam Project.
A BC Hydro representative told Fort St. John's Energetic City that Site C was "hit hard by the two outbreaks declared in April and August" 2021 and needed additional work due to geotechnical issues, but the project owners remained optimistic about the work schedule. Subscribers can learn more from Industrial Info's project report.
As another positive area, Edwards pointed to SNC-Lavalin's mining services business, which continued to show growth in the fourth quarter as it picked up new work and continued to add to the company's overall backlog of US$1.2 billion. Among the mining projects involving SNC-Lavalin that could begin construction this year is ioneer Limited's (Sydney, New South Wales) proposed sulfuric acid plant at its Rhyolite Ridge Lithium-Boron Mine in Silverpeak, Nevada, which would become just the second operational lithium mine in the U.S. if it begins production in 2024 as currently planned.
Nevada is seen as a potential global haven for lithium, a resource that has seen skyrocketing demand amid the dramatic expansion of the battery market. The only U.S.-based mine currently producing lithium is located about halfway between Las Vegas and Reno. Lithium is a key component in materials used in smartphones, electric vehicles and facilities that store energy developed through renewable generation. Sulfuric acid is used to leach ores produced in the mining process. Subscribers can learn more about the Rhyolite Ridge sulfuric acid project from Industrial Info's project report.
Upbeat View on Nuclear Market, Despite Axed Venture
Edwards expressed confidence in the nuclear energy market during the earnings-related conference call: "I think, in the longer term, we're going to see a resurgence of nuclear energy." He said the "nuclear agenda is pretty much in play across many, many countries," adding: "With recent events, I think a lot of energy policies [in different countries] will potentially change. And I actually think they were onto change anyway--nuclear is really one of the strongest options for clean energy."
Edwards pointed to Canada as a strong market for nuclear, noting "certain provinces are committed to it with life-extension [projects], and even the potential for new build." SNC-Lavalin currently is providing engineering and other services for life extensions to three units at the Darlington Nuclear Power Station in Bowmanville, Ontario, each of which has an 881-MW capacity, and is modernizing Unit 6 at the Bruce B Nuclear Station in Tiverton, Ontario. Subscribers can read detailed reports on Unit 1, Unit 3 and Unit 4 at Darlington, and Unit 6 at Bruce.
SNC-Lavalin is taking a more cautious approach in the nuclear decommissioning market. Toronto's The Globe and Mail reported last week that it was ending a four-year joint venture with Holtec International (Camden, New Jersey) in which the two companies pursued U.S.-based decommissioning projects. In the conference call, Edwards said the decision was "not a material impact to the business" and that Holtec "wants a partner that is prepared to take more risk." He noted that SNC-Lavalin still has decommissioning and life-extension opportunities in the U.S., the U.K. and Canada.
Ukraine Conflict Puts Focus on Joint Venture
SNC-Lavalin has spent the past few years divesting from non-core assets, and the war in Ukraine might force such a move. According to The Narwhal, a Canadian-based news site that focuses on environmental issues, SNC-Lavalin has been attempting in recent days to divest from a joint venture with Rosneft, the Russian state-controlled oil and gas company that, along with Gazprom, is among the 13 companies slapped with heavy sanctions by the U.S. and other Western nations. Industrial Info is tracking more than US$6.6 billion worth of active projects involving OAO VNIPIneft, the joint venture company in which SNC-Lavalin holds 48%. Subscribers can click here for a full list.
For more information on how the war in Ukraine and the resulting sanctions are affecting industrial development, see February 28, 2022, article - Russia's Invasion of Ukraine Puts Both Countries' Industrial Heavyweights in Rough Waters; March 3, 2022, article - Russian Invasion Slams Brakes on European Car Industry; and March 3, 2022, article - U.S. Steel Imports Up 43% in 2021; Russia a Main Source of Growth.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: LinkedIn.
The engineering-focused company is moving forward with several high-profile projects in 2022, including those for mining, nuclear energy and infrastructure, that it hopes will reverse the trend. Industrial Info is tracking more than US$47 billion worth of active projects involving SNC-Lavalin worldwide, including more than US$36 billion worth in the U.S. and Canada.
"With the [COVID-19] omicron variant, we were seeing absenteeism of up to 50% on some of the jobs," said SNC-Lavalin President Ian Edwards in a quarterly earnings-related conference call with analysts. "And we had a very significant spike in productivity loss. I was on both job segments in Trillium recently to see and feel just how impactful productivity loss has been. And when you think about these jobs at the end of their stages, with social distance requirements that restricts a number of people you can put on the job with absenteeism, it obviously means we're struggling to get labor on the job."
Edwards was referring to the US$1.77 billion Stage 2 extension of Ottawa's light-rail Trillium Line South, which is part of a broader, US$4.6 billion light-rail extension program. The 9.9-mile project, which would link various points in the city to the Ottawa International Airport, began construction in third-quarter 2019 and originally was set to wrap up toward the end of last year; it will not wrap up until the third quarter of this year, at the very earliest. Subscribers to Industrial Info's Global Market Intelligence (GMI) Project Database can read a detailed project report.
One project is back on track after facing a series of delays related to COVID-19: BC Hydro's (Vancouver, British Columbia) Site C Dam Project in Fort St. John, British Columbia, which is the highest-valued project involving SNC-Lavalin's services. Construction of the 1.1-gigawatt (GW) hydroelectric power station on the Peace River began in early 2016 and reached 50% completion in December, with a revised in-service date for early 2025.
Click on the image at right for a map of the Site C Dam Project.A BC Hydro representative told Fort St. John's Energetic City that Site C was "hit hard by the two outbreaks declared in April and August" 2021 and needed additional work due to geotechnical issues, but the project owners remained optimistic about the work schedule. Subscribers can learn more from Industrial Info's project report.
As another positive area, Edwards pointed to SNC-Lavalin's mining services business, which continued to show growth in the fourth quarter as it picked up new work and continued to add to the company's overall backlog of US$1.2 billion. Among the mining projects involving SNC-Lavalin that could begin construction this year is ioneer Limited's (Sydney, New South Wales) proposed sulfuric acid plant at its Rhyolite Ridge Lithium-Boron Mine in Silverpeak, Nevada, which would become just the second operational lithium mine in the U.S. if it begins production in 2024 as currently planned.
Nevada is seen as a potential global haven for lithium, a resource that has seen skyrocketing demand amid the dramatic expansion of the battery market. The only U.S.-based mine currently producing lithium is located about halfway between Las Vegas and Reno. Lithium is a key component in materials used in smartphones, electric vehicles and facilities that store energy developed through renewable generation. Sulfuric acid is used to leach ores produced in the mining process. Subscribers can learn more about the Rhyolite Ridge sulfuric acid project from Industrial Info's project report.
Upbeat View on Nuclear Market, Despite Axed Venture
Edwards expressed confidence in the nuclear energy market during the earnings-related conference call: "I think, in the longer term, we're going to see a resurgence of nuclear energy." He said the "nuclear agenda is pretty much in play across many, many countries," adding: "With recent events, I think a lot of energy policies [in different countries] will potentially change. And I actually think they were onto change anyway--nuclear is really one of the strongest options for clean energy."
Edwards pointed to Canada as a strong market for nuclear, noting "certain provinces are committed to it with life-extension [projects], and even the potential for new build." SNC-Lavalin currently is providing engineering and other services for life extensions to three units at the Darlington Nuclear Power Station in Bowmanville, Ontario, each of which has an 881-MW capacity, and is modernizing Unit 6 at the Bruce B Nuclear Station in Tiverton, Ontario. Subscribers can read detailed reports on Unit 1, Unit 3 and Unit 4 at Darlington, and Unit 6 at Bruce.
SNC-Lavalin is taking a more cautious approach in the nuclear decommissioning market. Toronto's The Globe and Mail reported last week that it was ending a four-year joint venture with Holtec International (Camden, New Jersey) in which the two companies pursued U.S.-based decommissioning projects. In the conference call, Edwards said the decision was "not a material impact to the business" and that Holtec "wants a partner that is prepared to take more risk." He noted that SNC-Lavalin still has decommissioning and life-extension opportunities in the U.S., the U.K. and Canada.
Ukraine Conflict Puts Focus on Joint Venture
SNC-Lavalin has spent the past few years divesting from non-core assets, and the war in Ukraine might force such a move. According to The Narwhal, a Canadian-based news site that focuses on environmental issues, SNC-Lavalin has been attempting in recent days to divest from a joint venture with Rosneft, the Russian state-controlled oil and gas company that, along with Gazprom, is among the 13 companies slapped with heavy sanctions by the U.S. and other Western nations. Industrial Info is tracking more than US$6.6 billion worth of active projects involving OAO VNIPIneft, the joint venture company in which SNC-Lavalin holds 48%. Subscribers can click here for a full list.
For more information on how the war in Ukraine and the resulting sanctions are affecting industrial development, see February 28, 2022, article - Russia's Invasion of Ukraine Puts Both Countries' Industrial Heavyweights in Rough Waters; March 3, 2022, article - Russian Invasion Slams Brakes on European Car Industry; and March 3, 2022, article - U.S. Steel Imports Up 43% in 2021; Russia a Main Source of Growth.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: LinkedIn.
